using assessments for hiring and retaining good people
TRANSCRIPT
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Gregory P. SmithPresident
Chart Your Course International Inc.
ChartCourse.com770-860-9464
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Workforce Trends -- Gallup
• 86% of business leaders do not have an adequate leadership pipeline
• 79% have a significant retention and engagement problem
• 75% are struggling to recruit and attract top people they need
• Only 17% feel they have a compelling brand-culture
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Employee Retention
60%: Yes, I intend to leave
21%: Maybe, so I’m networking
6%: Not likely, but I’ve updated my resume
13%: No, I intend to stay
Source: Right Management
“Do you plan to pursue
new job opportunities as
the economy improves?”
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Why Good People QuitPoor match between the person and
the job
Poor fit with the organizational climate and culture
Poor alignment between pay and performance
Poor connections between the individual, their coworkers and the supervisor
Poor opportunities for growth and advancement
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Critical FindingIt Costs Much More to
Replace Employees Than
to Retain Them
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Turnover Costs Vary • Low paying jobs: 16% of annual salary for high-
turnover, (earning under $30,000 a year). For
example, the cost to replace a $10/hour retail
employee would be $3,328.
• Mid-range jobs: 20% of annual salary positions
(earning $30,000 to $50,000 a year). For example,
the cost to replace a $40k manager would be
$8,000.
• Executive jobs: Up to 213% of annual salary. For
example, the cost to replace a $100k CEO is
$213,000.
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Cost Per HireDeparture Costs
Downtime, exit interviews, administrative time to terminate benefits etc.?
Replacement Costs
Advertising, screening, interviewing, hiring, background checks, recruitment
costs, uniforms etc.
?
Training & Development Costs
Orientation, training time, time taken away from management. ?
Lost Productivity
Overtime, lost sales etc. It may take a new employee 1-2 years to reach the
productivity of an existing person.
?
Customer Service Costs
Errors, Bad reviews. For example new employees take longer and are often
less adept at solving problems.
?
Cultural Impact
Whenever someone leaves others take time to ask "why?“ Departure of friends,
lack of credibility etc.
?
Total Cost ???
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Client Example: Past 6 Months
Cost to replace a $10/hour
service employee is $3,328
22 employees departed =
30.6% Turnover Rate
Cost of Turnover for 6 months22 X $3,328 = $73,216
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Why are your
employees quitting?
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Most interviewing techniques are ineffective
We Must Improve Our Hiring Practices
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Typical Job Interviews
42% of turnover could be eliminated with effective hiring and
interviewing techniquesIra Wolfe
Perfect Labor Storm
The typical interview only increases the likelihood of choosing the best
candidate by less than 2% John and Rhonda Hunter
The University of Michigan
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Most Interviews are Biased
A study of 80 randomly selected individuals who
participated in two simulated job interviews,
58% were more likely to be hired and 53% received higher salary offers after
their teeth had been whitened
Kelton Research
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“Get the right people on the bus, the wrong people off the bus, and the
right people in the right seats.”
“People are NOT your most important asset. The RIGHT people are.”
Jim Collins
From Good to Great Right People
angela
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What Do the “Right”
People Look Like?
How do you know who is the Rightperson for the Right Job?
Every job requires different skills and a different type of behavior style.
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Most People
Are Hired for
their
Experience, But
Fired for Their
Attitude
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Assessments provide an unemotional evaluation of a person’s behavior, attitudes, values and
talent – qualities difficult to judge in an
interview alone.
The Missing Piece
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Assessments are good for:
Selection
Placement
Development & Coaching
Team Effectiveness
Engagement
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30%
Assessment
Results
30% Interview
10% Company
Culture30%
Background
& References
30, 30, 30, 10Rule
Selection Process
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RESULT: Engaged Employees
Employees who have
an above average
attitude toward their
work and their
employer will
generate…
Deloitte Talent
Management Study
Job Engagement
Customer Satisfaction
Scores
38% higher
Profits
27%higher
Productivity
22%higher
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Good employees help businesses thrive
• Happier customers
• Happier co-workers
• Positive word of mouth advertising
• Positive reviews and likes on the internet
• Healthier bottom-line
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Benchmarking the Job
Each position has a different talent
profile for success
The best way to select top performers is to identify and understand the current
performers in the same position.
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Turnover Reduced from 30% to 16%
Identifying Top Performers
Highest
Retention
Rates
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The Best Company Presidents
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The cost of using
assessments is a
drop in the bucket
compared to hiring
the wrong people
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Final Take-A-Ways
1. Measure employee satisfaction
2. Use assessments for hiring
3. Manage Your culture
4. Effective orientation program
5. Hire good managers
6. Get rid of bad managers
7. Conduct exit surveys
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Try an online assessment for free
http://www.chartcourse.com/free-
disc-assessment/
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Chart Your Course
International770-860-9464
800-821-2487
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“Helping Organizations Create Great Places to Work”